Tether has issued a “new stable currency”. What is the difference between USDT0 and USDT?

Author: Penny, BlockBeats

Today, Tether announced the first deployment of its new token USDT0 on Kraken's Ethereum extended network Ink, aiming to develop a cross-chain liquidity layer using LayerZero's full-chain fungible token standard (Omnichain Fungible Token Standard) and simplify the cross-chain transfer of USDT. Chain transfer, providing a seamless user and developer experience.

As a stablecoin previously launched by Tether, USDT has become the world's largest single stable asset. However, the liquidity of stablecoins is currently fragmented, USDT on different chains cannot flow and interoperate, and high cross-chain costs have always kept ordinary investors away. The launch of USDT0 is to solve this problem. On the one hand, it cooperates with LayerZero to greatly improve the security of cross-chain transactions. On the other hand, it achieves zero wear and tear on cross-chain transfers (examples below), realizing the business scope of USDT. Further expansion expands the utility of USDT on the blockchain.

Paolo Ardoino, CEO of Tether, said: "USDT0 brings an extremely necessary solution to achieve the smooth flow of USDT between different ecosystems. It fits in with Tether's overall vision and optimizes users by improving interoperability and reducing obstacles. experience. It’s really exciting to see innovation like this emerge and actually meet market needs.”

Greatly reduce cross-chain costs

USDT has always been interoperable, but in a fragmented way. Each blockchain has its own USDT. If you want to transfer USDT between different chains, you have to rely on solutions such as cross-chain bridges, that is, USDT is destroyed on one chain and minted on another chain.

With USDT0, the situation is different: USDT now becomes a single, liquid asset across blockchains and is no longer dispersed. To be precise, the same token can be transferred smoothly between different networks.

For users, USDT0 eliminates the problem of fragmentation and means higher financial efficiency. Below is an example of transferring 10,000 USDT from Ethereum to Avalanche (left), and now using USDT0 powered by LayerZero (right). It can be seen that using USDT0, users can get as much as they transfer across the chain, which greatly reduces the loss of expensive handling fees.

expansion plan

Ink: The gateway to institutional liquidity

USDT0 will be launched first on Ink, the L2 blockchain launched by Kraken, one of the world's largest and most trusted cryptocurrency exchanges. Leveraging the world's largest stablecoin, USDT0 builds a seamless channel for liquidity between institutions.

Andrew Koller, founder of Ink, said: "Both USDT0 and Ink are committed to ensuring that users and developers have maximum control over their assets and access to various opportunities as seamlessly as possible. USDT0 chose Ink as its The first chain will open a new standard for stablecoin liquidity to flow on all chains in the future.”

In addition, USDT0 has been integrated with Kraken, allowing users to deposit and withdraw USDT0 on Ink. There are more integrations planned within the Kraken technology stack, which will set the standard for USDT0 interoperability and pave the way for a world-class experience for USDT users.

First round of cooperation and expansion: Berachain and MegaETH

Following Ink, the first round of partners for USDT expansion through USDT0 include Berachain and MegaETH, with more related announcements to be made in the coming weeks.

Berachain is a Layer 1 (L1) blockchain fully compatible with the Ethereum Virtual Machine (EVM), built on an innovative Proof of Liquidity (PoL) consensus mechanism. This mechanism will use the network’s native governance token $BGT to reward users who actively contribute resources to the network. The integration of USDT0 on Berachain will be launched on the Boyco platform, which aims to bring funds directly into core applications on Berachain. Composed of 11 decentralized applications and 15 asset issuers (including USDT0), Boyco is an ideal channel to reserve funds for the pursuit of income for the launch of Berachain. Boyco’s pre-deposited vault has already attracted over $1.5 billion in deposits, a number that is expected to grow significantly with the launch of the official project and the addition of high utility value assets like USDT0.

MegaETH is the first real-time blockchain, enabling 100,000 transactions per second and block times of less than 10 milliseconds, while inheriting the security of Ethereum. MegaETH looks forward to leveraging USDT0 across a wide range of DeFi applications and payment products. Combining real-time applications with Tether distribution capabilities will accelerate the next wave of cryptocurrency adoption.

In general, USDT is the largest stablecoin in the world and the most sought-after on-chain asset by users and the blockchain itself. USDT0 is the expansion method of USDT, which optimizes the high cross-chain cost of USDT, making USDT even The entire cryptocurrency ecosystem has become friendlier.